Glu Mobile Inc. (GLUU) Still Struggling to Monetize Mobile Games

Electronic Arts Inc. (NASDAQ:EA) remains the preeminent game producer, and along with Zynga Inc (NASDAQ:ZNGA) both have over $1 billion in cash to invest in the mobile gaming sector. Though EA has a significant console gaming revenue base, it is quickly moving into mobile as the top global publisher on the iOS platform. The company lists over $100 million in quarterly mobile revenue in Q113.

Zynga Inc (NASDAQ:ZNGA) built itself into prominence developing for the Facebook Inc (NASDAQ:FB) platform, but it is now fiercely focused on mobile. The company reported that comScore listed it as number 6 in total time spent on mobile with 11.2 billion minutes. For Q113, mobile bookings were 22% of total bookings or roughly $50 million. The company remains very reliant on Facebook Inc (NASDAQ:FB) for revenue despite the strong mobile usage. Zynga Inc (NASDAQ:ZNGA) has a roughly 70 million monthly user based compared to the 40 million for Glu Mobile Inc. (NASDAQ:GLUU).

Bottom line

While initial signs emerged of improving monetization via games launched during Q113, the company still was forced to guide for Q213 to a level substantially below the original expectations only a year ago. The company has several new initiatives with the GaaS, real-money games, third party publishing, and enhanced monetization plans that all individually could propel the stock higher.

For now though, Glu Mobile Inc. (NASDAQ:GLUU) remains an extremely interesting stock with homerun potential that does nothing but strike out. The company only has a market value of around 2 times revenue, so any improvements in monetizing the existing gaming franchises could reward investors. One big hit and this stock could soar, but that big hit appears more and more improbable every day that passes.

The article Glu Mobile Still Struggling to Monetize Mobile Games originally appeared on Fool.com and is written by Mark Holder.

Mark Holder and Stone Fox Capital Advisors, LLC has no positions of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Mark is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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